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How to select a contractor for design-build

By Annie Schwemmer and Ann Robinson

For the Deseret News

Published: Saturday, July 5 2014 6:10 p.m. MDT

Last week, we began a discussion on a type of construction philosophy and practice known as the design-build process. Rather than having one group (owners and architect) create a set of construction documents and a different group (contractors) provide a budget, this process puts all interested parties on the same team beginning with the design phase and continuing through construction.

This process integrates the concepts of design and budget in order to create a project that results in maximum design with minimal budget discrepancies. This is not an easy process, and it requires understanding and good communication skills on the part of all involved.

How do you select a contractor without any plans to bid out? First, you need a list of three or four possibilities. You find these by talking to friends and neighbors, checking out websites and getting recommended names from your architect. Contact each builder and set up an appointment at your home. At this meeting, you can show them the house and discuss in general terms what you think you may do — such as dig out the basement, add a second story, put an addition on the back, update the curb appeal, etc. In turn, you will gather information from the contractor relative to the company’s history, remodeling experience, availability and general markup.

After checking out their references, you need to make a decision as to which contractor you think would work with you best. It is a little bit like dating; good chemistry is useful for a good remodeling project.

So, here is a summary of the process so far:

1. Meet with an architect to discuss your wants and wishes, your goals and visions for your home.

2. While your architect is developing the master plan, begin interviewing contractors.

3. Select a contractor.

4. The team (homeowners, architect and contractor) meet together to review the master plan and the contractor provides a budget estimate. This is not a bid, but a range of projected costs based on reasonable assumptions.

At this point, the structural requirements are not determined, and the finishes have not yet been selected. The contractor must use the preliminary plans and his experience to provide a reasonable cost for the major line items of a remodel, such as concrete, framing, windows, flooring, cabinets, etc. "Range of cost" is the key concept here, as much remains to be determined.

Using the formula “size x finish = cost,” the project can be adjusted at this point to make sure the estimated cost is within a range that is acceptable. As the design progresses, the contractor is able to keep the focus on the budget by pointing out which decisions/selections reflect the assumptions he made for his estimate and which deviate from it. In theory, he could point out that the flooring selected is less expensive than the assumption he made; however, he is far more likely to have to repeatedly remind the team that choices being made have costs that are higher than his estimate.

When you are looking at the project as a whole, you are in a position to splurge on one or two things (appliances or granite counters, for instance) if you land below the estimated cost for other items (such as a laminate counter in the laundry or deferring installation of cabinets and shelves in the office).

In addition, if you wait to make selections of finishes and equipment until the remodeling project is well under way, half of the money has already been spent. This limits your options as you are no longer able to negotiate on size in order to save money for the upgraded appliances or countertops you long for.

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